Third Quarter 2017 Results Presentation 26 October 2017 - - PowerPoint PPT Presentation
Third Quarter 2017 Results Presentation 26 October 2017 Disclaimer: This material should be read as an overview of OCBCs current business activities and operating environment. It should not be solely relied upon by investors or potential
Disclaimer: This material should be read as an overview of OCBC’s current business activities and
investors when making an investment decision. OCBC Bank accepts no liability whatsoever with respect to the use of this document or its content.
2
Note: - Certain comparative figures have been restated to conform with the current period’s presentation.
Net profit for the quarter rose 12% YoY to S$1.1b; ROE at 11.4%
up only 1% QoQ while YoY increase included Barclays WIM costs
ratio unchanged at 1.3%. Coverage ratios maintained above 100% Earnings Assets and liabilities
LDR at 85.3%
CASA deposits made up 50.5% Capital and liquidity
3 Net Interest Income: S$1.4b
(3Q16 : S$1.2b)
Non-interest Income: S$1.0b
(3Q16 : S$1.0b)
Net Profit: S$1.1b
(3Q16 : S$0.9b)
Operating Expenses: S$1.0b
(3Q16 : S$1.0b)
ROE: 11.4%
(3Q16 : 10.8%)
Customer Loans: S$232b
(3Q16 : S$209b)
Customer Deposits: S$268b
(3Q16 : S$247b)
CET1 ratio: 13.1%
(3Q16 : 15.1%)
Leverage ratio: 7.6%
(3Q16 : 8.4%)
All-currency LCR: 147%
(3Q16 : 133%) Group performance
Allowances: S$0.2b
(3Q16 : S$0.2b)
783 850 863 159 233 194 3Q16 2Q17 3Q17 Net profit (S$m) 943 1,057 1,083
Banking operations GEH +12% YoY
3Q17 2Q17 QoQ 3Q16 YoY
S$m S$m +/(-)% S$m +/(-)%
Net interest income 1,382 1,345 3 1,234 12 Non-interest income 978 1,053 (7) 970 1 Total income 2,360 2,398 (2) 2,204 7 Operating expenses (1,001) (992) 1 (953) 5 Operating profit 1,359 1,406 (3) 1,251 9 Amortisation of intangibles (26) (27) (2) (23) 7 Allowances (156) (169) (8) (166) (6) Associates 127 119 6 105 21 Tax & non-controlling interest (“NCI”) (247) (246) 1 (224) 10 Net profit 1,057 1,083 (2) 943 12
OCBC Group
Net profit increased 12% YoY to S$1.1b
4
Group performance
4
9M17 9M16 YoY
S$m S$m +/(-)%
Net interest income 3,999 3,801 5 Non-interest income 3,008 2,511 20 Total income 7,007 6,312 11 Operating expenses (2,967) (2,807) 6 Operating profit 4,040 3,505 15 Amortisation of intangibles (78) (72) 9 Allowances (493) (421) 17 Associates 361 314 15 Tax & NCI (717) (642) 12 Net profit 3,113 2,684 16
OCBC Group
Nine months net profit rose 16% YoY to S$3.1b
Group performance
5
3Q17 2Q17 QoQ 3Q16 YoY
S$m S$m +/(-)% S$m +/(-)%
Net interest income 1,360 1,322 3 1,209 12 Non-interest income 674 700 (4) 706 (5) Total income 2,034 2,022 1 1,916 6 Operating expenses (946) (929) 2 (896) 6 Operating profit 1,088 1,093 – 1,020 7 Allowances (149) (166) (10) (161) (7) Associates 131 123 6 110 19 Amortisation, tax & NCI (207) (201) 3 (186) 11 Net profit from banking operations 863 850 2 783 10 GEH net profit contribution 194 233 (17) 159 22 OCBC Group net profit 1,057 1,083 (2) 943 12
Banking Operations
Third quarter net profit before GEH contribution (“Banking Operations”) rose 2% QoQ and 10% YoY to S$863m
6
Banking Ops performance
6
9M17 9M16 YoY
S$m S$m +/(-)%
Net interest income 3,931 3,728 5 Non-interest income 2,061 1,931 7 Total income 5,992 5,659 6 Operating expenses (2,786) (2,643) 5 Operating profit 3,206 3,016 6 Allowances (479) (409) 17 Associates 371 324 14 Amortisation, tax & NCI (592) (558) 6 Net profit from banking operations 2,506 2,373 6 GEH net profit contribution 607 311 96 OCBC Group net profit 3,113 2,684 16
Banking Operations
Nine months net profit for Banking Operations increased 6% YoY to S$2.5b
7
Banking Ops performance
S$725m S$843m TWNS
12% 8% 5% 8% 67% 19% 8% 5% 7% 61%
Note: Further details on the subsidiaries are set out in the Appendix. “ppt” denotes percentage points.
8
Group’s 9M17 net profit: S$3.1b
OCBC Wing Hang OCBC Malaysia OCBC NISP
+26% +9% +6% HKD1,453m HKD1,826m Net profit +9% +2% Flat RM647m RM707m Net profit +23% +17% +20%
Major subsidiaries contributed 39% to the Group’s 9M17 net profit
IDR1,358b IDR1,669b Net profit
Rest of OCBC Group
HKD160b HKD175b Loans RM68b RM69b Loans IDR88t IDR103t Loans
Major subsidiaries
HKD199b HKD210b Deposits IDR95t IDR115t Deposits RM73b RM72b Deposits
9M16 9M17
+86% +8%
+16%
Great Eastern Holdings
43.5% 40.4% NBEV margin S$315m S$341m NBEV
Key Metrics YoY
S$394m S$733m Net profit
Net Profit Contribution to the Group
9M17 9M16
9
51% 18% 6% 22% 3%
Singapore Malaysia Indonesia Greater China Others
54% 16% 6% 20% 4%
43% 23% 12% 14% 8% Global Corporate / Investment Banking Global Consumer / Private Banking Global Treasury and Markets Insurance OCBC Wing Hang 26% 11% 22% 33% 8%
within which OCBC Wing Hang: 8% (9M16: 8%)
Earnings well-diversified across key geographies and business segments
10
1/ Operating profit after allowances and amortisation. Excludes the Others segment, which comprises mainly property holding, investment holding, items not attributable to the business segments, as well as the offset of China operations which is reported in both the business segments and OCBC Wing Hang. 2/ This included OCBC Bank (China) from mid July 2016.
9M17 PBT by Business1/ 9M17 PBT by Geography
2/
2/
Earnings
9M17 9M16 9M17 9M16
Singapore S$2.1b YoY: +23% Malaysia S$596m YoY: -2% Indonesia S$229m YoY: +17% Greater China S$762m YoY: +6% Others S$165m YoY: +41%
3,848 3,801 3,999 1,307 1,260 1,234 1,251 1,272 1,345 1,382 5,189 5,052 2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17
11
Net interest income (S$m) Net interest margin (“NIM”)
3Q17 NII up 3% QoQ and 12% YoY, driven by asset growth and higher NIM
Net interest income
9M 1.67% 1.67% 1.64% 1.75% 1.68% 1.62% 1.63% 1.62% 1.65% 1.66%
40.5% 40.5% 42.9% 36.6% 38.5% 44.0% 42.5% 43.4% 43.9% 41.4%
1,643 1,638 1,461 193 192 127 552 529 417 228 429 276 781 649 727 136 374 417 428 420 481 492 488 34 49 68 40 36 47 45 122 123 163 122 158 140 118 101 53 112 162 91 96 89 122 146 199 182 211 278 238
3,533 3,437 3,008 753 788 970 926 977 1,053 978 2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17
Fees & commissions Dividends & rental income Trading income Net gains from investment securities and
Non- interest income (S$m) Non- interest income / Total income
Life & General Insurance
3Q17 non-interest income rose 1% YoY
12
Non-interest income
Realised gain from the sale of an investment in GEH’s equity portfolio
Wealth Management Income1/ (S$m)
27% 27% 32% 23% 25% 28% 30% 32% 33% 31%
Great Eastern Embedded Value3/ (S$m) Bank of Singapore Earning Asset Base (US$b)
3Q17 wealth management income grew 18% YoY across consumer banking, private banking and insurance operations; BOS’ AUM rose 53% YoY and 6% QoQ to US$95b
13
1,742 1,629 2,253
482 520 627 644 724 789 741
2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17
As % of Group income
AUM Loans
8,605 9,214 10,436 11,001 11,694 Dec 12 Dec 13 Dec 14 Dec 15 Dec 16
1/ Wealth management income comprises the consolidated income from insurance, asset management, stockbroking and private banking subsidiaries, plus the Group's income from the sales of unit trusts, bancassurance products, structured deposits and other treasury products to consumer customers. 2/ 9M15 included a realised gain of S$136m from the sale of an investment in GEH’s equity portfolio. 3/ An actuarial embedded value is a commonly used technique to estimate the economic value of the existing business of a life insurance company.
43 46 51 55 79 95 9 11 14 13 18 22 52 57 65 68 97 117 Dec 12 Dec 13 Dec 14 Dec 15 Dec 16 Sep 17
2/
Wealth management
Dec 12 – Dec 16 CAGR 17%
2,354
Dec 12 – Dec 16 CAGR 8%
2,273
9M
570 588 636 174 164 134 556 533 396 86 63 68 257 290 227 126 150 155 157 215 215 205 40 39 43 44 43 44 47 126 136 135 135 123 137 137 14 15 21 13 29 24 15 68 77 74 71 71 72 84 1,643 1,638 1,461 374 417 428 420 481 492 488
2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17
14
Wealth management1/ Brokerage & Fund Management Loan, Trade & Guarantees Investment Banking Others2/ Fees and commissions (S$m)
1/ Mainly comprising income from private banking, and sales of unit trusts, bancassurance products, structured deposits and other treasury products to consumer customers. 2/ Others includes credit card fees, service charges and other fee and commission income.
3Q17 fee income rose 14% YoY from broad-based income growth across the Group’s business segments
Fee income / Total income
Non-interest income
18.8% 19.3% 20.9% 18.2% 20.3% 19.4% 19.3% 21.4% 20.5% 20.7%
2,254 2,347 1,829 737 763 583 673 678 555 578 583 601 585 602 619 608 183 189 186 205 192 195 195 162 160 166 191 179 178 198 3,664 3,788 2,967 923 932 953 981 973 992 1,001
2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17
Expenses grew only 1% QoQ as a result of ongoing cost discipline
15
Operating expenses (S$m) Cost / Income Staff costs Property & equipment Others
Operating expenses
Headcount (period end) 30,017 30,068 29,760 29,792 29,705 29,207 29,161 42.0% 44.6% 42.3% 44.8% 45.5% 43.2% 45.1% 43.3% 41.4% 42.4%
16
Portfolio allowances Net specific allowances/ (write-backs) Impairment charges/ (write- backs) for other assets
Net allowances for loans and
(S$m)
1/ Figures are computed on an annualised basis. 2/ Total loan allowances include net specific allowances and portfolio allowances. 3/ Write-backs of specific allowances for existing NPLs due to settlements and repayments. 4/ Recoveries of loans that had been written off.
3Q17 net allowances down QoQ & YoY; specific allowances largely set aside for restructured loans exhibiting ongoing weakness and for decline in collateral valuations
Net specific loan allowances 11 23 21 19 10 19 44 20 19 24 Total loan allowances 2/ 19 31 27 30 12 31 52 27 29 24 As a % of avg. loans (bps) 1/ Allowances Allowances for new & existing loans 418 666 514 136 90 154 286 149 173 192 Write-backs3/ (133) (126) (116) (26) (26) (36) (38) (31) (53) (32) Recoveries4/ (53) (56) (46) (11) (12) (19) (13) (10) (15) (22) Net specific loan allowances 232 484 352 99 52 99 235 108 105 138 Net specific loan allowances (S$m) 56 8 64 43 39 59 3 99 52 99 235 108 105 138 12 28 3 27 21 5 15 177 172 100 232 484 352 79 70 41 167 88 166 305 168 169 156 488 726 493 2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17
Rest of the world QoQ: +1% YoY: +25% Greater China QoQ: +3% YoY: +16% Indonesia QoQ: -1% YoY: +14% Malaysia QoQ: Flat YoY: -1% Singapore QoQ: +2% YoY: +8%
Broad-based YoY growth of 11% across most industry segments and key markets
Customer Loans (S$b)
Loans
1/
Note: Customer loans by Geography based on where the credit risks reside, which may be different from the borrower’s country of residence or the booking location of the loans. 1/ The 25% YoY increase in customer loans from the “rest of the world” category was mainly from United Arab Emirates, Australia, United States of America and United Kingdom.
17 88 89 91 94 96 96 98 29 29 28 28 28 28 28 17 17 17 18 19 20 19 52 49 49 54 54 56 57 22 22 24 26 28 29 30
208 205 209 220 225 229 232 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17
+11% YoY +2% QoQ In constant ccy terms +12% YoY +2% QoQ
43% 14% 8% 5% 6%
Singapore Malaysia Indonesia Greater China Other Asia Pacific Rest of the World
42% 12% 8% 25% 6% 7% 24%
Loans portfolio well-diversified across geographies and industries
18
Customer Loans by Industry Customer Loans by Geography S$232b
Sep 17
Note: Customer loans by Geography based on where the credit risks reside, which may be different from the borrower’s country of residence or the booking location of the loans. 1/ Comprising the “Transport, storage & communication”, “Agriculture, mining & quarrying” and “Others” industry groupings.
Loans
Sep 16
27% 28% 16% 17% 15% 13% 12% 11% 12% 11% 6% 6% 5% 5% 3% 4% 5% 4%
28% 16% 13% 12% 12% 6% 13% 27% 15% 16% 12% 12% 6% 12% Housing loans FIs, investment & holding cos Professionals & individuals General commerce Others Manufacturing Building & construction
S$232b
Sep 17 Sep 16
1/
6 5 5 5 6 6 6 13 12 12 14 14 14 15 27 27 26 29 28 30 31 2 2 2 2 2 2 2 4 4 4 4 4 4 3
52 49 49 54 54 56 57 Mar 16 Jun 16 Sep 16 Dec 16 Mar 17 Jun 17 Sep 17
19
Note: Customer loans to Greater China is based on where the credit risks reside, which may be different from the borrower’s country of residence or the booking location of the loans. 1/ Relates to loans that are booked in China, where credit risks reside. 2/ Relates to loans that are booked outside of China, but with credit risks traced to China. China 1/ Offshore 2/ Hong Kong Taiwan Macau
Loans up QoQ and YoY; sound asset quality and coverage ratios maintained
Customer Loans to Greater China (S$b) NPL ratio Total allowances/ NPAs
Loans
260% 137% 148% 157% 184% 171% 185% 0.4% 0.7% 0.7% 0.7% 0.6% 0.6% 0.5%
1/ % NPL over total customer loans. 2/ Others includes exposure to names involved in other O&G activities such as exploration and production (including integrated oil majors) and refining.
based on stress-test results
exposure as at 30 September 2017, of which 24% are classified as NPLs
Loans
NPL ratio 1/
On-balance sheet exposure Off-balance sheet exposure
6% of total customer loans
20
NPLs
Total O&G exposure remained relatively stable QoQ (S$b) (S$b)
2/
0.43% 0.45% 0.53% 0.61% 0.62% 0.59% 0.63% 12.4 12.6 12.2 13.4 15.0 13.6 13.5 1.7 1.7 1.9 2.4 2.1 2.2 2.5 0.9 0.9 1.1 1.3 1.4 1.4 1.5 14.1 14.3 14.1 15.8 17.1 15.8 16.0 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17
15.8 16.0 0.2 0.1 0.1
10 11 12 13 14 15 16 17 Jun 17 FX impact OSV Traders Others Sep 17
Note: Commodities include agriculture & soft commodities, metals, mining & quarrying, and commodities trading. 1/ % NPL over total customer loans.
commodities (e.g. metals) 29%
Loans
21
6% of total customer loans
NPL ratio 1/ (S$b) (S$b)
On-balance sheet exposure Off-balance sheet exposure NPLs
QoQ increase largely due to a rise in short-term trade exposure 0.10% 0.16% 0.13% 0.13% 0.12% 0.11% 0.05% 11.9 11.5 12.9 13.7 13.6 13.7 14.1 2.3 2.1 2.4 3.4 2.8 2.1 2.6 0.2 0.3 0.3 0.3 0.3 0.3 0.1 14.2 13.6 15.3 17.1 16.4 15.8 16.7 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17
15.8 16.7 0.6 0.2 0.3
10 11 12 13 14 15 16 17 18 Jun 17 FX impact Traders Soft comm Hard comm Sep 17
New NPA formation eased; NPL ratio of 1.3% stable over 4 quarters with healthy coverage ratios maintained
22
Note: NPAs comprise NPLs and classified debt securities/contingent liabilities.
NPAs (S$m)
Total allow./ NPAs 113% 100% 101% 100% 101% 101% 101% Total allow./ unsecured NPAs 384% 271% 308% 303% 297% 304% 309%
NPL ratio
Singapore NPLs Malaysia NPLs Indonesia NPLs Debt securities / Contingent liabilities Greater China NPLs Rest of the World NPLs Asset quality
1.0% 1.1% 1.2% 1.3% 1.3% 1.3% 1.3%
604 536 525 745 924 828 913 717 441 614 607 584 717 700 461 653 622 689 621 626 677 185 355 340 354 307 323 304 187 372 376 388 374 365 334 67 131 108 103 60 61 55 2,221 2,488 2,585 2,886 2,870 2,920 2,983
Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17
Secured NPAs/ Total NPAs 71% 63% 67% 67% 66% 67% 67%
Excluding oil and gas NPLs, the NPL ratio continued to be stable over the past
Non-oil & gas NPL ratio Oil & gas NPL ratio 23
Asset quality
3Q17
S$m
2Q17
S$m
3Q16
S$m
Opening balance 2,920 2,870 2,488 New NPAs 409 445 497 Net recoveries/ upgrades (243) (270) (328) Write-offs (103) (125) (72) Closing balance 2,983 2,920 2,585
NPL ratio NPAs
0.61% 0.70% 0.66% 0.65% 0.63% 0.66% 0.63% 0.43% 0.45% 0.53% 0.61% 0.62% 0.59% 0.63% 1.04% 1.14% 1.19% 1.26% 1.25% 1.25% 1.26%
Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17
Growth in customer deposits underpinned by 9% YoY increase in CASA balances; CASA ratio at 50.5% of total deposits
24
Note: CASA ratio refers to the ratio of current account and savings deposits to total customer deposits.
Customer Deposits (S$b) CASA ratio
Deposits
Current Account Savings Deposits Fixed Deposits Others
49.3% 49.3% 50.2% 51.1% 49.9% 50.9% 50.5% 76 78 78 85 82 84 84 44 44 46 48 50 51 51 106 108 108 114 115 108 108 17 17 16 14 18 22 25 242 246 247 261 265 264 268
Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17
S$119b S$121b
S$132b
+S$11b YoY +S$1b QoQ S$124b S$134b
S$135b S$135b
81 91 80 92 81 94 81 94 83 94 83 95 84 96 46 67 46 72 49 73 57 80 60 84 60 83 61 84 22 24 22 24 21 23 21 22 20 22 20 22 20 22 28 23 28 23 28 24 30 27 30 26 31 26 32 26 7 9 6 8 5 7 5 8 5 8 6 7 5 8 7 6 6 7 7 7 7 8 7 8 8 8 7 8 17 22 17 20 18 19 19 22 20 23 21 23 23 24 208 242 205 246 209 247 220 261 225 265 229 264 232 268
LoansDeposits LoansDeposits LoansDeposits LoansDeposits LoansDeposits LoansDeposits LoansDeposits
RMB 83.1% 71.3% 75.8% 64.7% 65.8% 73.2% 69.0% USD 67.7% 63.1% 66.7% 70.4% 71.0% 72.0% 72.0% SGD 89.5% 87.3% 86.8% 86.1% 88.2% 87.4% 87.7%
Group LDR at 85.3%
25
Customer Loans and Customer Deposits (S$b)
SGD USD MYR HKD RMB IDR Others
1/ Group LDRs based on net customer loans / customer deposits; LDRs by currency based on gross customer loans / customer deposits.
Mar 16 Jun 16 Sep 16 Dec 16 Mar 17 Jun 17 Sep 17 LDRs1/
Funding 84.7% 82.2% 83.1% 82.9% 83.6% 85.2% 85.3%
Group LDR1/
Funding Composition as of 30 Sep 2017
Customer deposits 77% Bank deposits 3% Debt issued 9% Capital & reserves 11%
Wholesale Funding by Currency as of 30 Sep 2017
USD 73% GBP 12% AUD 6% EUR 3% Others 6%
Average Liquidity Coverage Ratio CASA by Currency
Well-diversified funding mix; customer deposits formed majority of the funding base
26
S$b Sep 16 Jun 17 Sep 17 Group 124 135 135 SGD 62 68 67 USD 35 36 38 MYR 6 6 6 HKD 9 11 11 IDR 2 3 3
Total funding: S$351b 122% 130% 133% 145% 143% 144% 147%
259% 273% 271% 284% 267% 260% 269% 60% 110% 160% 210% 260% 310% 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 SGD LCR All- currency LCR
Note: Both Singapore dollar and all-currency LCRs were higher as compared to the regulatory requirements effective at each reporting date.
By Maturity: ≤ 1 year 78% > 1 year 22% Total debt issued: S$32b
Others 7% Current account & savings deposits 39% Fixed deposits 31%
Funding
(within which Covered Bonds: 0.2%)
27
Note: Capital ratios are computed based on Basel III transitional arrangements. 1/ Based on Basel III rules which will be effective from 1 January 2018. 2/ Leverage ratio of 7.6% as at 30 September 2017 was well above the 3% minimum requirement as guided by the Basel Committee.
Capital Adequacy Ratios (%) Total CAR Common Equity Tier 1 CAR
CET1 capital (S$m) 27,846 28,417 28,728 29,143 27,688 27,800 27,807 Tier 1 capital (S$m) 28,856 29,434 29,736 29,968 29,558 29,684 29,694 RWA (S$m) 189,940 189,862 189,775 197,763 207,224 212,527 211,372
Capital position remained robust and well above regulatory requirements
Proforma Common Equity Tier 1 CAR 1/
Leverage ratio 2/ (%) 8.2 8.2 8.4 8.2 7.7 7.8 7.6
Tier 1 CAR
Capital 17.3 17.5 17.6 17.1 16.5 16.1 16.2 15.1 15.5 15.6 15.1 14.2 13.9 14.0 14.6 14.9 15.1 14.7 13.3 13.0 13.1 12.4 12.7 12.8 12.4 12.2 12.0 12.0 Mar 16 Jun 16 Sep 16 Dec 16 Mar 17 Jun 17 Sep 17
28
29
Net profit contribution to the Group rose 22% YoY to S$194m
Note: For comparative reasons, Operating and Non-Operating Profit figures for periods prior to 3Q17 have been restated using exchange rates as at 30 September 2017. The differences between the restated and previously reported Operating Profit figures were included in the Non-Operating Profit. 1/ Operating Profit (net of tax) is defined as premiums less claims, surrenders, commissions, expenses and changes in reserves, plus investment income (dividends, coupons, etc). 2/ Non-operating profit / loss (net of tax) mainly comprises changes in the fair value of assets and liabilities, realised gains / losses on sale of investments, changes in liability discount rates and other non-recurring items. 3/ Primarily from adjustments made to amortisation for intangibles and non-controlling interest.
Great Eastern
GEH
3Q17
S$m
2Q17
S$m
QoQ
+/(-)%
3Q16
S$m
YoY
+/(-)%
Profit from insurance business 212 245 (13) 173 23
159 158 1 135 18
32 73 (57) 20 61
22 14 57 18 18 Profit from Shareholders’ Fund 59 68 (12) 59 1 Profit from operations 271 312 (13) 231 17 Allowances (7) (4) 56 (5) 30 Associates – (0) (100) (1) (100) Tax & NCI (29) (29) 2 (30) (3) Net profit 236 279 (16) 195 21 Group adjustments 3/ (42) (46) (9) (36) 17 Net profit contribution to Group 194 233 (17) 159 22
30
Nine months earnings contribution up 96% to S$607m GEH
9M17
S$m
9M16
S$m
YoY
+/(-)%
Profit from insurance business 640 382 68
438 384 14
149 (53) 380
53 51 4 Profit from Shareholders’ Fund 195 107 83 Profit from operations 835 489 71 Allowances (14) (13) 11 Associates (0) (1) (98) Tax & NCI (88) (81) 9 Net profit 733 394 86 Group adjustments 3/ (126) (84) 51 Net profit contribution to Group 607 311 96
Great Eastern
Note: For comparative reasons, Operating and Non-Operating Profit figures for periods prior to 3Q17 have been restated using exchange rates as at 30 September 2017. The differences between the restated and previously reported Operating Profit figures were included in the Non-Operating Profit. 1/ Operating Profit (net of tax) is defined as premiums less claims, surrenders, commissions, expenses and changes in reserves, plus investment income (dividends, coupons, etc). 2/ Non-operating profit / loss (net of tax) mainly comprises changes in the fair value of assets and liabilities, realised gains / losses on sale of investments, changes in liability discount rates and other non-recurring items. 3/ Primarily from adjustments made to amortisation for intangibles and non-controlling interest.
109 122 95 318 227 222 121 134 106 13 13 16 29 30 30 33 29 34 32 48 64 65 50 49 89 84 39 33 36 26 38 32 35 2 5 4 3 5 3 8 561 496 438 117 132 135 112 122 158 159
2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17
Note:
reserves, plus investment income (dividends, coupons, etc).
using exchange rates as at 30 September 2017. The differences between the restated and previously reported Operating Profit figures were included in the Non-Operating Profit.
31
Operating profit from insurance business (S$m)
3Q17 operating profit was up 18% YoY, mainly driven by the Singapore insurance business
+18% YoY
Participating Fund Non-participating Fund Investment- linked Fund General Insurance Fund
Great Eastern
Note:
gains / losses on sale of investments, changes in liability discount rates and other non-recurring items.
using exchange rates as at 30 September 2017. The differences between the restated and previously reported Operating Profit figures were included in the Non-Operating Profit.
32
23 (40) 149 (40) (33) 20 13 44 73 32 2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 Non-operating profit/(loss) from insurance business (S$m)
3Q17 non-operating profit at S$32m from favourable equity markets and narrowing of credit spreads
Great Eastern
624 691 596 305 361 234 37 16 14 151 157 180 204 203 167 226 65 81 81 134 74 84 76 3 4 4 5 4 5 5
966 1,068 843 218 242 265 343 281 256 306 2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17
33
TWNS (S$m) Singapore Emerging markets Malaysia
TWNS rose 16% YoY, led by growth in agency and bancassurance sales in Singapore
16% YoY
Note: For comparative reasons, total weighted new sales figures for periods prior to 3Q17 have been restated using exchange rates as at 30 September 2017. From 1 Dec 2015, sales from GEH’s investment in China have been excluded. 1/ TWNS for FY16, 1Q16 and 2Q16 included sales from Group’s investment in Vietnam up to June 2016.
Great Eastern
1/ 1/ 1/
245 307 215 132 153 121 4 5 4 53 66 90 98 65 76 74 28 36 38 50 37 43 41 1 1 1 2 1 2 2
382 465 341 83 103 129 150 103 121 117 2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17
39.5% 43.6% 40.4% 37.8% 42.7% 48.9% 43.8% 36.5% 47.4% 38.1%
3Q17 NBEV at S$117m with NBEV margin of 38.1%
34
NBEV (S$m) NBEV margin (NBEV / Total weighted new sales) Singapore Emerging markets Malaysia
Note: For comparative reasons, NBEV figures for periods prior to 3Q17 have been restated using exchange rates as at 30 September 2017. NBEV figures for periods in 2016 have been restated to take into account revised actuarial assumptions implemented in 4Q16. From 1 Dec 2015, NBEV from GEH’s investment in China have been excluded. 1/ NBEV for FY16, 1Q16 and 2Q16 included NBEV from Group’s investment in Vietnam up to June 2016.
Great Eastern
1/ 1/ 1/
Net profit up QoQ and YoY in local currency terms
35
OCBC Wing Hang
3Q17
HKD m
2Q17
HKD m
QoQ
+/(-)%
3Q16
HKD m
YoY
+/(-)%
Net interest income 1,106 1,023 8 976 13 Non-interest income 565 321 76 379 49 Total income 1,671 1,343 24 1,355 23 Operating expenses (764) (715) 7 (767)
907 628 44 589 54 Allowances 44 (37) (219) (43) (202) Associates 16 18 (13) (17) 194 Profit before tax 966 609 59 529 83 Tax (119) (115) 3 (80) 48 Net profit (HKD m) 847 494 71 448 89 Net profit contribution to Group (S$m) 2/ 91 74 23 71 29 Key ratios (%) Cost / Income 45.7 53.3 56.6
Note: Results of OCBC Bank (China) were included from mid July 2016. 1/ 3Q17 included higher net gains from sale of investment securities. 2/ Net profit contribution to Group after group adjustments, which are primarily amortisation for intangibles, allowances and depreciation of property and equipment; and fair value adjustments for its subordinated debt securities and investment securities to conform with OCBC Group’s policies.
OCBC Wing Hang
1/ 1/ 1/
Net profit up 26% YoY to HKD1.8b
36
OCBC Wing Hang
9M17
HKD m
9M16
HKD m
YoY
+/(-)%
Net interest income 3,101 2,804 11 Non-interest income 1,197 922 30 Total income 4,298 3,726 15 Operating expenses (2,190) (1,953) 12 Operating profit 2,109 1,773 19 Allowances (15) (110) (87) Associates 48 24 102 Profit before tax 2,142 1,687 27 Tax (316) (234) 35 Net profit (HKD m) 1,826 1,453 26 Net profit contribution to Group (S$m) 2/ 238 222 7 Key ratios (%) Cost / Income 50.9 52.4
Note: Results of OCBC Bank (China) were included from mid July 2016. 1/ 9M17 included higher net gains from sale of investment securities. 2/ Net profit contribution to Group after group adjustments, which are primarily amortisation for intangibles, allowances and depreciation on property and equipment; and fair value adjustments for its subordinated debt securities and investment securities to conform with OCBC Group’s policies.
OCBC Wing Hang
1/ 1/
236 307 379 398 312 321 565 1,079 1,320 1,197 2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 1.76% 1.75% 1.59% 1.83% 1.73% 1.73% 1.73% 1.60% 1.60% 1.57% 601
Note: Results of OCBC Bank (China) were included from mid July 2016. 1/ In 1Q17, net interest margin fell 23bps YoY to 1.60% mainly from lower loan and bond yields, against higher deposit costs. 2/ 3Q17 and 9M17 included higher net gains from sale of investment securities.
Net interest income rose 8% QoQ while non-interest income grew 76% from higher net gains from sale of investment securities
3,774 3,820 3,101 943 885 976 1,016 972 1,023 1,106 2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17
Non-interest income (HKD m)
22.2% 25.7% 27.9% 20.0% 25.8% 28.0% 28.1% 24.3% 23.9% 33.8%
Net interest income (HKD m)
Net interest margin Non-int. income/ Total income
37
OCBC Wing Hang
1/ 2/ 2/
186 177 199 198 199 204 210 Mar 16 Jun 16 Sep 16 Dec 16 Mar 17 Jun 17 Sep 17 0.6% 0.7% 0.9% 0.9% 0.8% 0.9% 0.8% 80.7% 81.5% 80.6% 82.1% 83.4% 83.3% 83.1% NPL ratio Loans / Deposits 1/
Gross Loans (HKD b) Deposits (HKD b)
CASA Ratio 31.5% 35.3% 34.0% 37.1% 35.7% 36.9% 36.5% Note: Results of OCBC Bank (China) were included from mid July 2016. 1/ Loans-to-deposits ratio calculation based on gross customer loans / customer deposits.
Loans and deposits both increased QoQ; NPL ratio lower QoQ at 0.8%
150 144 160 163 166 170 175 Mar 16 Jun 16 Sep 16 Dec 16 Mar 17 Jun 17 Sep 17
38
OCBC Wing Hang
Net profit 4% above previous quarter and increased 22% YoY
39
OCBC Malaysia
3Q17
RM m
2Q17
RM m
QoQ
+/(-)%
3Q16
RM m
YoY
+/(-)%
Net interest income 355 345 3 314 13 Islamic banking income 1/ 108 115 (6) 116 (7) Non-interest / finance income 128 164 (22) 121 6 Total income 591 624 (5) 551 7 Operating expenses (280) (284) (1) (267) 5 Operating profit 311 340 (9) 284 10 Allowances 24 (29) (183) (16) (250) Profit before tax 335 311 8 268 25 Tax (90) (76) 18 (67) 34 Net profit (RM m) 245 234 4 201 22 Net profit contribution to Group (S$m) 2/ 78 73 9 66 19 Key ratios (%) Cost / Income 47.4 45.5 48.5 CAR 3/
12.7 12.5 12.8
14.6 14.4 14.7
17.4 17.4 18.0
1/ Islamic banking income comprises net finance income and other income contributed by Islamic banking subsidiary OCBC Al-Amin. 2/ Net profit contribution to Group after adjustments to align to OCBC Group’s policies. 3/ Capital ratios for OCBC Malaysia Group are computed in accordance with the Capital Adequacy Framework issued by Bank Negara Malaysia.
OCBC Malaysia
Nine months net profit rose 9% to RM707m
40
OCBC Malaysia
9M17
RM m
9M16
RM m
YoY
+/(-)%
Net interest income 1,046 980 7 Islamic banking income 1/ 334 361 (7) Non-interest / finance income 419 403 4 Total income 1,799 1,744 3 Operating expenses (820) (804) 2 Operating profit 979 940 4 Allowances (32) (83) (61) Profit before tax 947 857 11 Tax (240) (210) 14 Net profit (RM m) 707 647 9 Net profit contribution to Group (S$m) 2/ 224 215 4 Key ratios (%) Cost / Income 45.6 46.1 CAR 3/
12.7 12.8
14.6 14.7
17.4 18.0
1/ Islamic banking income comprises net finance income and other income contributed by Islamic banking subsidiary OCBC Al-Amin. 2/ Net profit contribution to Group after adjustments to align to OCBC Group’s policies. 3/ Capital ratios for OCBC Malaysia Group are computed in accordance with the Capital Adequacy Framework issued by Bank Negara Malaysia.
OCBC Malaysia
138 144 121 157 128 164 128
7 8 12 8 12 19 13
598 560 419 49 35 44 145 152 133 165 140 183 141 647 595 463 2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 331 335 314 329 346 345 355 119 111 104 101 99 96 95 1,367 1,309 1,046 465 435 290 450 446 418 430 445 441 450 1,832 1,744 1,336 2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17
3Q17 net interest/finance income up 8% YoY; Non-interest/finance income rose 6% YoY
41
Net interest/finance income (RM m) Non-interest/finance income1/ (RM m)
Islamic Conventional 1/ Non-interest/finance income comprises net fee and commission income, net trading income and other operating income.
1.99% 1.91% 1.93% 1.99% 1.94% 1.79% 1.91% 1.96% 1.92% 1.93%
Net interest/ finance margin Non-interest/finance income/ Total income
26.1% 25.4% 25.8% 24.4% 25.4% 24.1% 27.7% 24.0% 29.4% 23.9%
Islamic Conventional Note: Based on Bank Negara Malaysia’s guidelines and Malaysian Financial Reporting Standards. OCBC Malaysia
90.3% 89.7% 90.5% 91.5% 94.2% 92.4% 92.7% 2.1% 1.9% 2.1% 2.2% 2.1% 2.3% 2.3% 42
NPL Ratio Loans / Deposits
Gross Loans (RM b) Deposits (RM b)
Note: Based on Bank Negara Malaysia’s guidelines and Malaysian Financial Reporting Standards.
69 69 68 69 71 69 69
Mar 16 Jun 16 Sep 16 Dec 16 Mar 17 Jun 17 Sep 17
Customer loans at RM69b, NPL ratio at 2.3%; Deposits up 2% QoQ with CASA ratio at 31%
72 74 73 71 71 71 72
Mar 16 Jun 16 Sep16 Dec 16 Mar 17 Jun 17 Sep 17 CASA Ratio 27.6% 28.7% 30.5% 33.7% 32.6% 32.9% 30.5% OCBC Malaysia
Net profit increased 22% YoY to IDR539b
43
OCBC NISP
3Q17
IDR b
2Q17
IDR b
QoQ
+/(-)%
3Q16
IDR b
YoY
+/(-)%
Net interest income 1,537 1,515 2 1,332 15 Non-interest income 383 422 (9) 401 (5) Total income 1,920 1,937 (1) 1,733 11 Operating expenses (826) (847) (2) (806) 3 Operating profit 1,094 1,090 – 927 18 Allowances (377) (342) 10 (336) 12 Non Operating Income nm 1 nm Profit before tax 717 748 (4) 592 21 Tax (178) (181) (1) (148) 20 Net profit (IDR b) 539 567 (5) 444 22 Net profit contribution to Group (S$m)1/ 46 50 (8) 36 29 Key ratios (%) Cost / Income 43.0 43.7 46.5 CAR
16.8 16.6 17.9
16.8 16.6 17.9
17.7 17.5 19.0
Note: Capital ratios are computed based on the standardised approach under the Basel III framework. 1/ Net profit contribution to Group after adjustments to align to OCBC Group’s policies. OCBC NISP
Nine months net profit rose 23% YoY to IDR1.7t
44
OCBC NISP
9M17
IDR b
9M16
IDR b
YoY
+/(-)%
Net interest income 4,465 3,978 12 Non-interest income 1,146 1,100 4 Total income 5,611 5,078 11 Operating expenses (2,477) (2,363) 5 Operating profit 3,134 2,715 15 Allowances (924) (916) 1 Non Operating Income 9 nm Profit before tax 2,210 1,808 22 Tax (541) (450) 20 Net profit (IDR b) 1,669 1,358 23 Net profit contribution to Group (S$m)1/ 146 128 13 Key ratios (%) Cost / Income 44.1 46.5 CAR
16.8 17.9
16.8 17.9
17.7 19.0
Note: Capital ratios are computed based on the standardised approach under the Basel III framework. 1/ Net profit contribution to Group after adjustments to align to OCBC Group’s policies. OCBC NISP
16.2% 20.8% 20.4% 20.5% 21.3% 23.1% 18.2% 19.5% 21.8% 19.9%
3Q17 net interest income up 15%; non-interest income at IDR383b
45
Net interest income (IDR b) Non-interest income (IDR b)
Note: NIM and Non-interest Income/Total Income ratio calculation based on Bank Indonesia’s guidelines.
4,419 5,393 4,465 1,305 1,341 1,332 1,415 1,413 1,515 1,537 2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17
Net interest margin Non-int. income/ Total income
854 1,416 1,146 336 363 401 316 341 422 383 2015 2016 9M17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4.07% 4.62% 4.49% 4.79% 4.62% 4.49% 4.60% 4.31% 4.67% 4.48%
OCBC NISP
1.4% 1.4% 1.5% 1.9% 1.9% 1.9% 1.9% 46
NPL Ratio Loans / Deposits
Deposits (IDR t)
Loans grew 17% YoY, NPL ratio steady at 1.9%; deposits up 20% YoY
CASA Ratio 39.3% 41.9% 42.5% 39.4% 39.2% 43.5% 39.8% Note: Gross loans-to-deposits ratio calculation based on Bank Indonesia’s guidelines.
85 86 88 93 94 101 103
Mar 16 Jun 16 Sep16 Dec16 Mar 17 Jun 17 Sep 17
94.7% 92.8% 92.1% 89.9% 85.9% 94.3% 89.8% 90 93 95 104 110 106 115
Mar 16 Jun 16 Sep16 Dec16 Mar 17 Jun 17 Sep 17
Gross Loans (IDR t)
OCBC NISP